1. Technical Field
The present invention relates to a method of redeeming collectible points, and, in particular, to an internet based point redemption method that allows for the quick matching of the redemption of promotional points collected by consumers to promotional items while maintaining a fixed inventory cost for the promotional items. The method allows participants to bid on items offered on-line, thereby minimizing the need for inventory controls and nearly instantly tracking the demand for specific promotional items. The ability to quickly introduce new promotional items provided by the method encourages consumer participation and fosters interest in the promotional program.
2. Description of Related Art
Programs for redeeming collectible points for goods are common product promotional vehicles used by manufacturers and promoters in the retail industry, including the retail food industry. Typically, a consumer purchases a product having affixed to it a coupon representing a number of points that can be collected and redeemed for promotional goods or services, collectively referred to herein as promotional "items." The consumer collects points by purchasing products to which the coupons are affixed, either as part of the product package or contained within the product package. Others in the retail and service industries credit consumers with promotional points on the basis of purchases or other consumer actions that are tracked by the retailer or service provider. Promotional items can be obtained by redeeming a set number of collected points for a specific item offered. Frequently, the promotional items that are offered are tailored to attract a specific market segment of consumers in order to encourage that market segment to purchase the product and reward brand loyalty.
Current methods for redeeming collectible points, however, present several problems for the manufacturer, retailer, service provider, program administrator, or promoter, hereinafter all referred to as the "promoter." In order to maintain interest in a point redemption program, a promoter must periodically update the types of promotional items available. This usually involves offering a limited selection of items for a fixed time period. For example, a portable radio might be offered as a promotional item for a fixed number of redeemable points. In order to make the consumer aware of this item, the portable radio must either be advertised on the retail product container or in a catalog or other source readily available to the consumer. In establishing inventory control, the promoter must take into account the lag-time involved in -getting the promotional information to the consumer. A certain amount of time must also be set aside to allow the consumer to accumulate points over a reasonable time period. Some fixed date or fulfillment period must be provided, however, for the redemption of points for the radio. Otherwise, the promoter would have to maintain the radio in stock indefinitely.
Since the promoter does not know how many points will be collected and redeemed or what promotional items will be selected, an estimation must be made by the promoter as to the number of items to maintain in inventory. This estimation is a difficult task at best, involving predicting the number of redeemable points that will be collected, the percentage of the points collected that will be redeemed for a particular item, and the time period over which the item will generate the most interest. There is very little initial consumer feedback to assist with this process, because, typically, redemption for a particular item arises in-mass near the end of the fulfillment period. If the promoter underestimates the demand, additional promotional items must be purchased. If the promoter overestimates demand, it may be necessary for the promoter find another outlet for excess promotional item inventory. Further, in order to sort out the last minute redemptions at the end of the fulfillment period, the promoter must set aside several weeks to allow for the collection and counting of points, the matching of points to inventory, and the mailing of the promotional inventory back to the consumer. Additional lead time can be encountered when the promotional items afforded are proprietary or exclusive items. Accordingly, it is not unusual for a fulfillment period to take as long as twelve weeks.
All of the above results in a collectible points redemption program that provides consumer preference feedback after it is too late to adjust inventory and exposes the promoter to the risks involved in estimating appropriate promotional item inventory. For example, if too many portable radios were purchased as promotional inventory, they must be disposed. If too few were purchased, additional identical or substitute radios must be located and purchased, regardless of cost, to make up the short-fall. Consequently, promotional inventory is always a variable expense.
Prior art point redemption programs also typically limit the choice of promotional items for a committed time period. This is due to the requirement that a promoter list a given number of promotional items for a given time period, and make all of the required selection of items well in advance of advertising them. Therefore, the promotion is self-limiting without regard to consumer interests. In fact, a consumer might decide not to participate at all in the program if the limited items offered are not of particular interest to that consumer.
Importantly, the time required to collect and redeem points may result in a loss of interest for the program at the start for some consumers. The reality that a promotional item may not arrive until months after the first points are collected can be discouraging. The number of fixed points that must be redeemed for any specific promotional item may also be discouraging to the consumer.
Accordingly, a need exists for a method of redeeming collectible points that eliminates the necessity of estimating inventory levels, encourages consumer participation, and maximizes the effect of offering promotional items in exchange for promotion points. This method should provide quick and accurate feedback on consumer preferences on particular promotional items while, at the same time, streamlining the procedure for collecting points and shortening the lag-time between introducing promotional items and shipping promotional items to the consumer. Ideally, the method should fix inventory costs as much as possible in advance of the redemption period. Parental involvement should also be incorporated when minors are likely to participate in the promotion.